Question is from where did all that money suddenly flood the market and where’s that money now?
My assumptions... these are only my guesses as I don’t know the answer.
1. EPF did take profit and capital out of several of their investments. These would have contributed to a large % of the turnover. As per records they are yet to reinvest, so we may see money coming back into CSE soon.
2. There’s rumours of black money infusion and making it white.. which means black money was used to buy shares at low and cash out with profits. Which means this money has come and gone. I doubt this rumour but cannot rule out bcz it’s Sri Lanka. If it’s black money aren’t the tax authorities going to investigate from where the money originated? Hmm...
3. The large money infusion may have been contributed by the credit taken by the large number of new investors. The repercussions we are seeing now.
4. During the short bull run, cash in was higher than cash out and turnover hit record billions. When red days came cash out was higher but turnover dropped. Which means money which came into CSE has not all gone out. Most of it is still inside CSE. It will take a lot more red days for that cash to be taken out if that happens.
The situation could be a combination of all of the above.
Share your thoughts and any other ideas.